Bank of America Agrees to $8.5B Settlement

With another $8.5B to come
By Kevin Spak,  Newser Staff
Posted Jun 29, 2011 6:47 AM CDT
A couple walks into the Bank of America shareholders meeting in Charlotte, N.C., Wednesday, May 11, 2011.   (AP Photo/Chuck Burton)
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(Newser) – Bank of America has, as expected, reached an agreement for an $8.5 billion settlement with a group of disgruntled investors who lost truckloads of money buying mortgage-backed securities from Countrywide Financial, the bank announced today. It’s the largest payoff yet from a financial services firm, the Wall Street Journal reports, and it may embolden other financial crisis victims to file suits of their own.

The Bank said that the payment would “resolve nearly all” of its Countrywide obligations—BofA bought Countrywide in 2008 for $4 billion. It will hand over the money to Bank of New York Mellon Corp., which will then distribute it to other investors. The move makes the bank more likely to report a loss next quarter. (Read more Bank of America stories.)

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